DCANZ Looks Forward to High Quality EU Trade Deal
DCANZ LOOKS FORWARD TO HIGH QUALITY AND COMPREHENSIVE EU TRADE DEAL
The Dairy Companies Association of New Zealand welcomes the European Union’s decision move forward with negotiating a free trade deal with New Zealand.
“This is a significant milestone in New Zealand’s trade agenda, and we thank the Government and officials for their hard work,” says DCANZ Executive Director Kimberly Crewther. “We hope negotiations commence in a timely, comprehensive and ambitious way.”
DCANZ is placing priority on New Zealand and the EU reaching a high-quality trade agreement that includes the elimination of all existing tariff barriers.
New Zealand dairy exports to the EU are highly constrained as a result of significant market access barriers. Even the in-quota tariff on butter is 700 euro per tonne, meaning that in 2017 just 9000 of the more than two million tonnes of butter consumed in the EU was imported. Maintaining this level of protection does not make sense when the EU is a competitive dairy exporter in its own right, and there is significant two-way investment between the New Zealand and EU dairy industries.
New Zealand exported NZ$ 260 million of dairy products to the EU in 2017, the majority being protein products that face lower tariff levels. This made New Zealand the third largest dairy exporter to the EU after Switzerland (NZ$ 869 million) and the US (NZ$ 324 million).
“An ambitious EU/NZ negotiation is an opportunity to show joint leadership in the removal of barriers and distortions from agricultural markets – one of the agreed implementing actions of the UN Sustainable Development Goals.” says Crewther.
There are substantial benefits of removing trade barriers for New Zealand. The removal of tariffs will allow European customers to choose New Zealand products and ensure that New Zealand farmers and dairy processors receive the fair value for those goods. This will grow the export revenues, which flow through to jobs and benefit a wide range of New Zealanders. The dairy sector provides direct employment for 45,000 people, including accounting for more than one in five jobs in some districts. It also purchases goods and services from thousands of other businesses across New Zealand.
The continued deepening of trading relationships and ambition in implementing the UN Sustainable Development Goals, to support inclusive growth, also has broader significance given the challenging times globally.